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Regents asked to boost health premiums, deductibles

ATLANTA -- Faculty, staff and retirees of the University System of Georgia are likely to wind up with an increase in their health insurance premiums, co-pays and deductibles after the Board of Regents votes next month.

The premium changes range from a 6 percent decrease in the comprehensive plan to as much as a 33 percent jump in the high-deductible option. Co-pays will rise 20 percent from $25 to $30, and deductibles will rise to $500 in the comprehensive plan and $1,500 in the high-deductible option.

Wednesday, the board’s personnel committee got a briefing on the increases and an explanation of a recommended policy shift to what private industry calls a “defined benefit” approach. That means providing a set dollar amount instead of the employer paying the same percentage of the premium for each of the various insurance options regardless of their different costs.

Traditionally, the regents have paid about 75 percent of the premium of each of its four plan options. That percentage will soon vary as the system completes its three-year transition to the defined-benefit approach.

The phase in is to allow employees time to adjust their personal budgets, according to Marion Fedrick, vice chancellor for human resources.

“We didn’t want to increase employees very fast,” she said.

Regent Richard Tucker wanted to make sure the system’s workers understand the reasoning.

“We’re going to reallocate our share. It’s not going to be a savings (for the system),” he said.

Indeed, the regents expect to spend $19.2 million more on health insurance in 2015 plus the $14.6 million in additional premiums to be paid by the employees. Another $1.1 million will come from hiking the surcharge paid by tobacco users to $75 per month.

Regent Larry Ellison noted that the board is trying to balance the concerns of employees with those of the students and their parents. Since state appropriations of taxpayer funds to the system hasn’t kept pace with enrollment growth, increased expenses have to be paid by someone.

“This means this has to come from the tuition,” he said. “We’re concerned about affordability, and we have to hold the line.”

Most of the regents are weighing the same premium considerations in the companies they run. One of them, Regent Neil Pruitt, head of PruittHealth, said the system is following other employers in the way its coping with rising medical costs.

“I think there’s more we can do, but you’ve done a lot,” he told Fedrick.

Follow Walter Jones on Twitter @MorrisNews and Facebook or contact him at walter.jones@morris.com.